Amazon is once again focused on making progress in the home security space. This time, the company is promoting contract-free self-monitoring security packages, bundling them with consultation and installation services to reduce complexity for the user and enhance the overall customer experience. This approach has the potential to disrupt the DIY market for home security, by making it easier for users to monitor their homes and loved ones.
Over the past year, Amazon has been gradually making forays into the residential security marketplace. The acquisition of Blink and Ring and the launch of Amazon Key (in partnership with well-known smart lock vendors such as Yale) have helped Amazon to create a new smart home proposition beyond its own-branded products.
Amazon understands that the road to the smart home could be complex and not necessarily frustration-free for the end user, especially if the user is following a pure DIY approach. The company also understands that helping users in real life with in-person support services enhances the customer experience while offering more opportunities to upsell and cross-sell.
As a strategy to boost its service portfolio, Amazon has recently introduced five contract-free self-monitoring smart security packages which include not only the equipment, but also consultation and deployment services as part of the solution. Delivered by Amazon employees, these new packages are available in selected cities across the US, ranging from $240 to $840 depending on the customer's preferences and security needs and whether they are a homeowner or a renter.
This market initiative expands Amazon's current smart home service portfolio, helping the company to overcome the installation and setup barriers associated with the deployment of smart technology. Moreover, this strategy is giving Amazon the chance to continue educating customers and explore new potential avenues for its services business. Installing the new smart security packages involves two service appointments: an in-home consultation to customize the security package followed by an appointment to deploy the equipment. This means that Amazon is combining two services that for other smart home use cases are still being offered separately.
Amazon is adding more strands to its original smart home services strategy as it focuses on increasing its footprint in the residential security market. The company hopes to not only improve the customer experience, but also increase smart home users' adherence to Amazon devices and solutions from its partners. Ovum believes that Amazon's semi-DIY self-monitoring smart security approach will enable it to gain ground in the home security industry. However, this initiative won't pose a real threat to traditional home security providers such as ADT and Securitas which have built more advanced security propositions. These companies generally target a different audience not so keen on self-monitoring, but willing to pay recurrent fees for professional security services, including emergency support and 24×7 surveillance.
Mariana Zamoszczyk, Senior Analyst, Consumer Services